Microsoft Dynamics GP Year-End Update / 2016 Tax Update

Transcription

1 Microsoft Dynamics GP 2015 Year-End Update / 2016 Tax Update Microsoft Dynamics GP 2013 and Microsoft Dynamics GP 2015

2 Copyright Copyright 2015 Microsoft. All rights reserved. Limitation of liability This document is provided as-is. Information and views expressed in this document, including URL and other Internet Web site references, may change without notice. You bear the risk of using it. Some examples depicted herein are provided for illustration only and are fictitious. No real association or connection is intended or should be inferred. Intellectual property This document does not provide you with any legal rights to any intellectual property in any Microsoft product. You may copy and use this document for your internal, reference purposes. Trademarks Microsoft, Microsoft Dynamics, SQL Server, Windows, Windows Server, and Windows Vista are trademarks of the Microsoft group of companies. FairCom and c-tree Plus are trademarks of FairCom Corporation and are registered in the United States and other countries. All other trademarks are property of their respective owners. Warranty disclaimer Microsoft Corporation disclaims any warranty regarding the sample code contained in this documentation, including the warranties of merchantability and fitness for a particular purpose. License agreement Use of this product is covered by a license agreement provided with the software product. If you have any questions, please call the Microsoft Dynamics GP Customer Assistance Department at (in the U.S. or Canada) or Publication date December 2015

3 CONTENTS Contents Introduction...1 What s in this manual...1 What s changed...1 Resources...2 Symbols and conventions Chapter 1: Canadian Payroll year-end checklist... 5 Chapter 2: Preparation and installation... 7 Supported versions...7 Obtaining a CRA Web Access Code...7 Finding the Software Developer Number and RL-1 Authorization number...8 Installing the update...8 Chapter 3: Electronic filing in XML format Filing the T4/T4A in XML format...13 Filing the RL-1 in XML format...13 Filing an amended or cancelled RL-1 in XML format...14 Record of Employment (ROE) changes...14 Chapter 4: Tax updates Pension Plan and Employment Insurance, and T4s and RL1 changes...17 Federal tax rates and income thresholds...18 Federal personal amounts...18 Canada Employment Credit...19 Provincial and territorial tax changes...19 Updating basic personal amounts...24 Index factors for YEAR-END UPDATE / 2015 TAX UPDATE i

4 ii 2014 YEAR-END UPDATE / 2015 TAX UPDATE

5 INTRODUCTION Introduction This document contains instructions for updating the Canadian Payroll module for Microsoft Dynamics GP 2013 and Microsoft Dynamics GP 2015 to be compliant with 2015 filing requirements. This update also includes Round 1 tax updates for 2016 federal, provincial, and territorial taxes. These instructions assume that you are already familiar with Microsoft Dynamics GP Canadian Payroll. You can find information about year-end procedures in the Year-End Procedures, T4/R1 Routines, and T4A Routines chapters in the Canadian Payroll manual, or the sections of Help with the same names. Note, however, that the instructions in this document expand on those instructions and in some cases supersede them. This introduction contains the following sections: What s in this manual What s changed Resources Symbols and conventions What s in this manual This manual contains the following chapters: Chapter 1, Canadian Payroll year-end checklist, contains a checklist that you can use for year-end procedures. Chapter 2, Preparation and installation, specifies prerequisites, and provides installation instructions for the year-end update and tax update. Chapter 3, Electronic filing in XML format, contains information that you can use to prepare T4/T4A slips and RL-1 forms with Canadian Payroll for magnetic media filing in XML format. Chapter 4, Tax updates, describes the federal and provincial or territorial tax changes for What s changed The 2015 Year-End Update / 2016 Tax Update contains changes in the information that s submitted to the Canada Revenue Agency (CRA) and Ministère du Revenu du Québec. Tax changes See Chapter 4, Tax updates, for a description of 2016 federal, provincial, and territorial tax changes. All prior federal, provincial, and territorial tax changes are included in the 2015 Year-End Update / 2016 Tax Update YEAR-END UPDATE / 2016 TAX UPDATE 1

6 INTRODUCTION General application changes The 2015 Year-End Update / 2016 Tax Update contains application bug fixes and functionality updates to comply with regulatory changes. XML and form changes The T4 and RL-1 XML form have changed for the 2015 reporting year. The T4A and RL-1 form have note changed for the 2015 reporting year. A field was added to the Payroll T4/R1 Print - Canada window that s used to enter the RL-1 authorization number. This number indicates that the RL-1 slip was generated using Microsoft software. Microsoft has been approved as a vendor that is authorized by Revenue Quebec to provide that software.you ll need to enter the authorization number if you re using Microsoft Dynamics GP 2013 or Microsoft Dynamics GP To open the Payroll T4/R1 Print - Canada window, select Microsoft Dynamics GP >> Tools >> Routines >> Payroll Canada >> T4 and R1 Print. In the RL-1 Auth Number field, enter this year s authorization number. See Finding the Software Developer Number and RL-1 Authorization number on page 8 for information about finding the authorization number. Click OK to save the change. Installation notes The January 2016 Canadian Payroll Tax Update must be installed on the server and on each client workstation where Microsoft Dynamics GP is used. Before installing the update, be sure to complete the following tasks: All users should exit Microsoft Dynamics GP until the update has been installed on all workstations. Close all programs, turn off the screen saver, and back up important data and programs before continuing with the update. Save backup copies of your Reports.dic, R7131.dic, F7131.dic, Forms.dic, and Dynamics.vba files, if these files are present in your installation. Resources If you have questions about Canadian Payroll year-end closing procedures and your Microsoft Business Solutions Partner isn t available, there are several resources, in addition to this document, to assist in answering your year-end questions year-end information on CustomerSource ( Canadian Payroll Year End Update for Microsoft Dynamics GP) Look here to find out what year-end maintenance and tax changes are included in each update and to download the update. All instructions for downloading and installing the tax updates also will be provided here YEAR-END UPDATE / 2016 TAX UPDATE

7 INTRODUCTION Knowledge Base ( Provides you with instant access to the same database that our support engineers use. You can find answers to common questions, along with technical tips and performance recommendations. esupport ( For support requests that can be handled with . On average, the response time is nearly twice as fast as telephone support. That s a big benefit during the critical year-end season. Newsgroups ( Start a year-end discussion with other members of the Microsoft customer community. This database provides you with the opportunity to exchange information with other customers, which is perfect for providing tips and answers to year-end questions. Microsoft Canadian Payroll support team We have a support team focused entirely on providing service and support to our Canadian Payroll customers. If you have questions, dial toll free 888-GPS-SUPP ( ). Enter your 10-digit authorization code, then press 4 for the Payroll Tax Hotline. Symbols and conventions For definitions of unfamiliar terms, see your Canadian Payroll glossary in the manual or refer to the glossary in Help. Symbol Description The light bulb symbol indicates helpful tips, shortcuts and suggestions. The warning symbol indicates situations you should be especially aware of when completing tasks. This manual uses the following conventions to refer to sections, navigation, and other information. Convention Creating a batch File >> Print or File > Print TAB or ENTER Description Italicized type indicates the name of a section or procedure. The (>>) or (>) symbol indicates a sequence of actions, such as selecting items from a menu or toolbar, or pressing buttons in a window. This example directs you to go to the File menu and choose Print. All capital letters indicate a key or a key sequence YEAR-END UPDATE / 2016 TAX UPDATE 3

8 YEAR-END UPDATE / 2016 TAX UPDATE

9 CHAPTER 1 CANADIAN PAYROLL YEAR-END CHECKLIST Chapter 1: Canadian Payroll year-end checklist Use the following checklist for Canadian Payroll year-end processing. For detailed instructions for completing each step, refer to the sections listed in specific steps and to the instructions in the Canadian Payroll manual or online help. Step Description 1 Complete all 2015 pay runs. Note: Any batch with a cheque date of 2016 should be processed after the Year End File Reset. For example, if the cheque date of your final pay period for 2015 is January 1, 2016, the 2016 tax tables must be used for that pay run. 2 Complete any necessary 2015 payroll reports. 3 Make a backup of your data titled 2015 Pre Year-End Update. * 4 Install the 2015 Canadian Payroll Year-End Update. See Installing the update on page 8. Note: Do not restart Microsoft Dynamics GP on any workstation until the update has been installed on all workstations that run the application. 5 Complete the Year End File Reset. Note: To ensure that all tables are available for resetting, make sure that the Year End File Reset window is the only window open in Microsoft Dynamics GP. 6 Make a backup of your data titled Post 2015 Year-End Update. * Note: The following steps can be done any time after the Year End File Reset has been completed. 7 Create T4, T4A, and RL-1 statements, and print the T4, T4A, and RL-1 reports. 8 Edit the T4, T4A, and RL-1 records, as necessary. You can print an edit list from the Payroll Routines - Canada window. 9 Create T4, T4A, and RL-1 Summary records. 10 Print the T4, T4A and RL-1 statements. 11 Create T4, T4A, and RL-1 XML files, if appropriate. 12 Verify that pay periods and fiscal periods for 2016 are set correctly. *By law, you must be able to reproduce original or amended T4, T4A, and RL-1 slips for a predefined (agency assigned) number of years after the original filing. To meet this requirement, be sure to keep backups of all your Canadian Payroll data files, as well as copies of reports, tax forms, and filings. Canadian Payroll will only allow you to re-create a prior year filing if you save backup copies of the prior reporting year data YEAR-END UPDATE / 2016 TAX UPDATE 5

10 YEAR-END UPDATE / 2016 TAX UPDATE

11 Chapter 2: Preparation and installation This portion of the documentation specifies the requirements for installing the 2015 Year-End Update / 2016 Tax Update. Information is divided into the following sections: Supported versions Obtaining a CRA Web Access Code Finding the Software Developer Number and RL-1 Authorization number Installing the update Supported versions The 2015 Year-End Update / 2016 Tax Update supports Microsoft Dynamics GP 2013 and Microsoft Dynamics To identify the Microsoft Dynamics GP release you re using, start the application and choose Help >> About Microsoft Dynamics GP. To identify the Canadian Payroll release you re using, start Microsoft Dynamics GP, then open the Payroll Control Setup Canada window (Microsoft Dynamics GP menu >>Tools >> Setup >> Payroll - Canada >> Control). You should see the release number in the upper left corner of the window. If you are using an unsupported release of Microsoft Dynamics GP, you won t receive all of the necessary information to complete year-end closing and payroll tax procedures. This information includes personal amounts, Employment Insurance (EI), Canadian Pension Plan (CPP), and Quebec Pension Plan (QPP) amounts. To update the information, install Microsoft Dynamics GP 2013 or higher before installing this update. For more information about product discontinuation dates, refer to the discontinuation chart on CustomerSource ( >> Support Information. Choose Effectively predict support availability with the Microsoft Support Lifecycle Policy. Obtaining a CRA Web Access Code If you plan to use the Internet to submit T4 records, you need to obtain a Web Access Code from the Canada Revenue Agency (CRA), which preauthorizes you to submit files using this method. Web Access Codes are valid for one year only, so you need to get a new one each year. The Web Access Code consists of six characters: two letters, and four numbers. The code is case sensitive which means that you must enter it exactly as it appears on your personalized T4 Summary form. If you do not enter the code correctly, you will not be able to access the secure areas of the CRA s T4 Internet File Transfer site. For information, visit the following CRA page: Canadian Payroll for Microsoft Dynamics GP has the ability to generate the XML file required for T4 Internet File Transfer, but you are responsible for obtaining the access code and actually submitting the file to the CRA YEAR-END UPDATE / 2016 TAX UPDATE 7

12 CHAPTER 2 PREPARATION AND INSTALLATION Finding the Software Developer Number and RL-1 Authorization number If you plan to use the Internet to submit RL-1 records, you need to obtain the Software Developer Number and the RL-1 authorization number. Both numbers change every year. Both numbers can be found with the year-end update at CustomerSource ( downloads). You also can see XML and form changes on page 2 for RL-1 authorization number and the steps for entering it. Installing the update The update must be installed on each client workstation where Microsoft Dynamics GP is used. When installing the update, be sure to complete the following tasks: All users should exit Microsoft Dynamics GP until the update has been installed on all workstations. Close all programs, turn off the screen saver, and back up important data and programs before continuing with the update. Save backup copies of your Reports.dic, R7131.dic, F7131.dic, Forms.dic, and Dynamics.vba files, if these files are present in your installation. You must be using a supported version of Canadian Payroll. The 2015 Year-End Update / 2016 Tax Update supports Microsoft Dynamics GP 2013 and Microsoft GP To install the update: 1. Download the update from CustomerSource ( customersource/northamerica/gp/downloads). Language Microsoft Dynamics GP 2015 Microsoft Dynamics GP 2013 English MicrosoftDynamicsGP14-KB ENU.msp MicrosoftDynamicsGP12-KB ENU.msp French MicrosoftDynamicsGP14-KB FRCA.msp MicrosoftDynamicsGP12-KB FRCA.msp Save it to a folder on the local disk drive of the server workstation that runs Microsoft Dynamics GP. The year-end update file also includes all prior Microsoft Dynamics GP 2015 updates or Microsoft Dynamics GP 2013 R2 updates. A document describing the service pack changes is available from CustomerSource. 2. Double-click the file that you just downloaded. Progress windows appear as space requirements are verified and files are installed. 3. A message may appear, asking if you want to restart now or later. Click Yes to restart now, you will need to run the update file again after restarting. 4. After the installation is finished, manually restart your computer if a message directed you to do so earlier YEAR-END UPDATE / 2016 TAX UPDATE

13 CHAPTER 2 PREPARATION AND INSTALLATION 5. Start Microsoft Dynamics GP Utilities. Microsoft Dynamics GP 2013 Microsoft Dynamics GP 2015 Start >> All Programs >> Microsoft Dynamics >> GP 2013 >> GP Utilities Start >> All Programs >> Microsoft Dynamics >> GP 2015 >> GP Utilities 6. In the Welcome to Microsoft Dynamics GP Utilities window, verify your server name, enter the system administrator user ID and password, and click OK. 7. In the second welcome window, click Next. 8. In the Upgrade Microsoft Dynamics GP window, click Next. The Server Installation Progress window describes the process as it progresses. 9. In the Upgrade these companies window, click Next. All companies are selected to be updated. 10. In the Confirmation window, click Finish. Microsoft Dynamics GP Utilities updates your company databases. This process may take several minutes to complete. The Server Installation Progress window describes the process as it progresses. 11. After the update process is finished and is successful, the Additional Tasks window opens. If the update process wasn t successful, the Update Company Tables window opens. To contact Microsoft Dynamics GP Technical Support, see Resources on page 2 for more information. 12. In the Additional Tasks window, choose Update modified forms and reports and click Process. The Locate Launch File window appears. 13. Select the location of the launch file (Dynamics.set). In most cases you can accept the default location. Click Next. The Update Modified Forms and Reports window appears. 14. Mark the check box next to Microsoft Dynamics GP and any additional components listed. 15. When you mark a component s check box, a Product Details window may appear, allowing you to select the location of the component s original code dictionary. You also can open the Product Details window by selecting a component and clicking Details. When you apply an update (.msp file), any dictionaries whose compatibility ID has changed are backed up to a folder named Version <Version Number> Backup. This folder is located in the same folder as Dynamics.exe. The <Version Number> value is the version you were using before applying the update. If the original dictionary exists in the backup folder, Microsoft Dynamics GP Utilities will automatically display its location in the Product Details window, 2015 YEAR-END UPDATE / 2016 TAX UPDATE 9

14 CHAPTER 2 PREPARATION AND INSTALLATION and you can click OK to accept the location. If the location is missing or incorrect, click the file folder icon and browse to the appropriate location. 16. When you have finished selecting components, click Update. A Report Update Progress window displays the status of the update. When the process finishes, click Close. Log files containing detailed information are saved in the \Data folder. For each component, a report named Update<Version_Name>.log is generated. An update summary named Update<Verison>.txt is also generated. 17. In the Modified Forms and Reports window, click Next. The Additional Tasks window opens where you can start Microsoft Dynamics GP, or exit Microsoft Dynamics GP Utilities. 18. We recommend that you start Microsoft Dynamics GP and review all your modified forms and reports to verify whether they were updated correctly. 19. After the update to tables is completed, you can set up Automated Client Update to update all client workstations. For information about setting up the automatic updates, refer to your System Administrator manual. To install the update on an operating system with User Account Control (UAC) activated, see Installing with UAC activated. 20. To verify that you ve installed the latest year-end update and tax update, check the Last Year-End Update field in the Payroll Reset Files Canada window (Microsoft Dynamics GP menu >> Tools >> Routines >> Payroll Canada >> Year End File Reset). It should be 12/18/2015 or later. For the tax update, check the Last Tax Update field in the Payroll Control Setup Canada window (Microsoft Dynamics GP menu >> Tools >> Setup >> Payroll Canada >> Control). It should be 12/18/2015 or later. Installing with UAC activated User Account Control (UAC) is an enhanced security feature in Windows Vista, Windows 7, and Windows Server UAC is activated by default. Before performing actions that could affect your computer s operation, such as installing software updates, UAC asks for permission. To install the update on a client computer when UAC is active, copy the.msp file to each client workstation, then use one of the following methods: Start Microsoft Dynamics GP as a user that has administrative privileges on the local computer. (To do this, right-click on the Microsoft Dynamics GP shortcut and choose Run as administrator.) Double-click the.msp file to install it. Start the Command Prompt (located in the Accessories group) as a user that has administrative privileges on the local computer. (To do this, right-click on the Command Prompt shortcut and select Run as administrator.) Set the current directory to the location where you copied the.msp file YEAR-END UPDATE / 2016 TAX UPDATE

15 CHAPTER 2 PREPARATION AND INSTALLATION For Microsoft Dynamics GP 2015 (English), enter the following command. Msiexec /p MicrosoftDynamicsGP14-KB ENU.msp /l*v C:\MSPErrorlog.txt For Microsoft Dynamics GP 2015 (French), enter the following command. Msiexec /p MicrosoftDynamicsGP14-KB FRCA.msp /l*v C:\MSPErrorlog.txt For Microsoft Dynamics GP 2013 (English), enter the following command. Msiexec /p MicrosoftDynamicsGP12-KB ENU.msp /l*v C:\MSPErrorlog.txt For Microsoft Dynamics GP 2013 (French), enter the following command. Msiexec /p MicrosoftDynamicsGP12-KB FRCA.msp /l*v C:\MSPErrorlog.txt If you want the user to install updates and service packs without having administrative privileges on the local computer, you can change permissions for the folder where Microsoft Dynamics GP is installed. Be aware that doing this makes your computer less secure. View properties for the folder, and display the Security tab. Grant Modify permissions to an appropriate group, such as Users or Authenticated Users. Once the folder permissions are changed, any user in the group can install the.msp file by double-clicking it YEAR-END UPDATE / 2016 TAX UPDATE 11

16 YEAR-END UPDATE / 2016 TAX UPDATE

17 CHAPTER 3 ELECTRONIC FILING IN XML FORMAT Chapter 3: Electronic filing in XML format Canadian Payroll can generate electronic files in the XML format. You are responsible for submitting the file to the CRA or Revenue Quebec using one of the supported media types (diskettes, CD-ROMs, or DVD-ROMs) or over the Internet (if you have under 5 Mb of data to file). You don t need to have any special knowledge of XML to generate an XML electronic file using Canadian Payroll. Information is divided into the following sections: Filing the T4/T4A in XML format Filing the RL-1 in XML format Filing an amended or cancelled RL-1 in XML format Record of Employment (ROE) changes Filing the T4/T4A in XML format You can use Canadian Payroll to generate the T4 and T4A slips in XML files that you are responsible for submitting to the CRA. Data validation By using the XML format, the CRA is able to validate the file as soon as you submit it and alert you to any errors or omissions in the file. To help you submit an errorfree file, Canadian Payroll includes several features to validate your data prior to submission. Verification report You can print the T4 Error Report or T4A Error Report to verify the data in your XML file before you submit it to the CRA. The report will identify and describe any errors. You must resolve all the errors before you can generate the T4 and T4A XML files. Data entry validation As you enter data during the tax year, entries throughout Canadian Payroll that will be reflected in electronic files will be verified, and messages will advise you of any non-valid entries. T4 and T4A information is drawn from the following locations in Microsoft Dynamics GP. Type of data Source Employer information Payroll T4 Summary Edit Canada and Payroll T4A Summary Edit Canada windows Employee information Payroll T4 Edit Canada and Payroll T4A Edit - Canada windows Withholding amounts Cumulative totals, gathered during the payroll process, which are displayed on the Payroll T4 Edit Canada and Payroll T4A Edit - Canada windows Transmitter information Payroll Electronic Transfer T4/T4A windows Filing the RL-1 in XML format You can use Canadian Payroll to generate the RL-1 XML files that you are responsible for submitting to Revenue Quebec. For more information about changes to this form for the 2015 tax year, see What s changed on page YEAR-END UPDATE / 2015 TAX UPDATE 13

18 CHAPTER 3 ELECTRONIC FILING IN XML FORMAT Finding the Software Developer and RL-1 Authorization numbers Before you use the Internet to submit RL-1 records, you need to RL-1 Authorization number. The RL-1 Authorization number and the Software Developer Number can be found with the year-end update at CustomerSource ( mbs.microsoft.com/customersource/northamerica/gp/downloads). Both numbers change every year. Data validation features By using the XML format, Revenue Quebec will validate the file as soon as you submit it and alert you to any errors or omissions in the file. To help you submit an error-free file, Canadian Payroll includes several features to validate your data prior to submission. Verification report You can print the RL-1 Error Report to verify the data in your file before you submit it to Revenue Quebec. The report will identify and describe any errors. You must resolve all the errors before you can generate the RL-1 files. Data entry validation As you enter data during the tax year, entries throughout Canadian Payroll that will be reflected in electronic files will be verified, and messages will advise you of any non-valid entries. RL-1 information is drawn from the following locations in Microsoft Dynamics GP. Type of data Employer information Employee information Withholding amounts Transmitter information Source Payroll R1 Summary Edit - Canada window Payroll R1 Edit - Canada window Cumulative totals, gathered during payroll process, which are displayed on the Payroll R1 Edit - Canada window Payroll Electronic Transfer R1 window Filing an amended or cancelled RL-1 in XML format If changes are needed after you have submitted the RL-1 XML files to Revenue Quebec, you can use Canadian Payroll to generate amended or canceled files that you can then submit to Revenue Quebec. You use the Payroll R1 Edit window to make changes to RL records. You use the Payroll Electronic Transfer R1 window to generate the amended or canceled files. Record of Employment (ROE) changes In March 2016, Service Canada will require employers to use an updated file layout when submitting ROEs by Payroll Extract Files. The ROE Web application has an ROE Payroll extract file transfer capability that allows you to upload an ROE file extracted from Canadian Payroll. The layout of this ROE file is based on the ROE requirements as described in the ROE Payroll Extract File - XML File Layout. This allows you to specify ROEs that will be automatically submitted for serial number assignment, as well as ROEs that will be stored as Draft. This change includes a process that validates ROEs before they re submitted to Service Canada. When the processing and validation is complete you can view ROE YEAR-END UPDATE / 2015 TAX UPDATE

19 CHAPTER 3 ELECTRONIC FILING IN XML FORMAT files that have been issued, passed review, or that have failed and been rejected, from a web browser. Records that contain a Canada Revenue Agency Payroll Account Number (CRAPAN) number that doesn t exist, or that isn t valid, will be displayed with status of rejected ROE. Records that successfully passed the edits and were marked to be saved with a serial number are saved as read only and have a status of "issued" ROE. Records that successfully passed the edits and are marked to be saved as Draft are saved as Draft ROE and have a status of "passed" ROE. Records that failed the edits are saved as Draft and have a status of "failed" ROE. You can select ROEs that have passed validation and submit them to Service Canada. You can also select ROEs that failed validation and make the necessary updates using the Online Data Entry. When the corrections have been made you can store and validate, or submit and save the updated ROE(s). Alternatively, you can make the corrections to all the failed ROEs on the original file within Canadian Payroll software and upload a new file with only the corrected ROEs YEAR-END UPDATE / 2015 TAX UPDATE 15

20 YEAR-END UPDATE / 2015 TAX UPDATE

21 CHAPTER 4 TAX UPDATES Chapter 4: Tax updates This chapter lists changes to federal, provincial, and territorial tax rates for For detailed information about taxes, refer to the Canada Revenue Agency Web site at and Revenue Quebec s Web site at Information is divided into the following sections: Pension Plan and Employment Insurance, and T4s and RL1 changes Federal tax rates and income thresholds Federal personal amounts Canada Employment Credit Provincial and territorial tax changes Updating basic personal amounts Index factors for 2016 Pension Plan and Employment Insurance, and T4s and RL1 changes This sections lists changes for 2016 to the following entities: Canada Pension Plan (CPP) Quebec Pension Plan (QPP) Employment Insurance (EI) Quebec Parental Insurance Plan (QPIP) Record of Employment (ROE) format changes T4s Releve 1 slips CPP Contribution rates for both employers and employees will remain unchanged at 4.95%. The following changes are in effect for CPP for 2016: The maximum pensionable earnings amount will be updated to $54,900, from $53,600. The basic exemption remains unchanged at $3,500. The maximum contribution amount for the year increases to $2,544.30, from $2, QPP The following items are revised for QPP: Contribution rates for employers and employees will increase to 5.325%, from 5.25% The maximum pensionable earnings amount will increase to $54,900, from $53,600. The basic exemption will not change from $3, The maximum contribution amount for the year increases to $2, from $2, EI for non-quebec employees The EI Maximum Annual Insurable Earnings amount will increase to $50,800, from $49,500. The EI premium amount remains unchanged at 1.88%. The EI maximum annual premium amount increases to $ from $ YEAR-END UPDATE / 2015 TAX UPDATE 17

22 CHAPTER 4 TAX UPDATES The EI Employer Premium Rate amount will change to 2.632%. The employer EI premium is set using the Employer EI Factor field in the Payroll Employer Number Setup - Canada window (Tools >> Setup >> Payroll-Canada >> Employer). This factor must be set to 1.4 to meet the official EI Employer Premium. EI for Quebec employees The EI maximum annual insurable earnings amount will increase to $50,800, from $49,500. The EI (Quebec) Premium Rate amount shall decrease to 1.52%, from 1.54%. The maximum annual premium amount will increase to $772.16, from $ The EI Employer (Quebec) Premium Rate amount will increase to 2.156%, from 2.142%. The employer EI premium is set using the Employer EI Factor field in the Payroll Employer Number Setup - Canada window (Tools > Setup > Payroll-Canada > Employer). This field must be set to 1.4 to meet the official EI Employer Premium. QPIP The QPIP Maximum Annual Insurable Earnings amount will increase to $71,500, from $70,000. The Premium Rate amount will decrease to 0.548% from 0.559%. The Max Premium amount will increase slightly to $ from $ The Employer Premium Rate will decrease to 0.767%, from 0.782%. As a result the maximum employer amount will change to $ from $ Federal tax rates and income thresholds Effective January 1, 2016, the federal tax rates are not changed. The federal index factor is The income thresholds are revised as follows. Annual taxable income A More than - not more than ($) Federal personal amounts Rate R Constant K ($) 0 45,282 (formerly 44,701) ,282 90,563 (formerly 89,401) ,491 90, ,388 (formerly 138,586) , , , , ,000 and over ,683 Federal personal amounts have been increased by fixed amounts as shown in the following table. The Basic Personal amount shall be updated to $11,474 (formerly $11,327). The Spouse Common Law Partner amount shall be increased by the index factor to $11,474 (formerly $11,327). Provided the original amount wasn't zero YEAR-END UPDATE / 2015 TAX UPDATE

23 CHAPTER 4 TAX UPDATES The Eligible Dependent amount shall be increased by the index factor to $11,474 (formerly $11,327). Provided original amount wasn't zero. Canada Employment Credit The Canada Employment credit has been has been increased to $1,161 (formerly $1,146). Provincial and territorial tax changes The following provinces and territories have tax changes for The figures in the following tables are those supplied by the relevant revenue agencies. The actual figures calculated by Canadian Payroll my differ slightly due to rounding. This issue is recognized by the CRA and the differences will not subject you to penalties for over- or under-withholding. Alberta The Alberta basic personal amount is increased by the index factor (1.013), so it is usually revised to $18,451 (formerly $18,214). The Alberta spouse or common-law partner amount is increased by the index factor, so it is usually revised to $18,451 (formerly $18,214), provided the original amount wasn't zero. The following table shows tax rates and income thresholds for Annual taxable income (A) ($) Rate V Constant K ($) 0 125, $0 125, , $2, , , $4, , , $6, ,000 and over 0.15 $9,000 British Columbia The British Columbia basic personal amount is increased by the index factor (1.009) to $10,027 (formerly $9,938). The British Columbia spouse or common-law partner amount (and eligible dependent) is decreased by $336 to usually $8,586 (formerly $8,922), provided original amount wasn't zero. The provincial tax reduction for British Columbia is indexed and calculated as follows: If net income is less than or equal to $19,171 (formerly $18,327). The reduction is equal to the lesser of the basic provincial income tax or $436 (formerly $412) [(annual net income - $19,171) X 3.5%] If net income is more than $31, (formerly $31,202.00), there is no reduction YEAR-END UPDATE / 2015 TAX UPDATE 19

24 CHAPTER 4 TAX UPDATES The following table shows tax rates and income thresholds for Annual taxable income A ($) Rate V Constant K ($) 0 38,210 (formerly 37,606) $0 38,210 76,421 (formerly 75,740) $1,009 (formerly 1000) 76,421 87,741 (formerly 86,958) $3,149 (formerly 3,120) 87, ,543 (formerly 105,592) $4,719 (formerly 4,677) 106,543 and over $7,287 (formerly 7,222) Manitoba The Manitoba Basic Personal amount remains at $9,134. The Manitoba index factor is The Manitoba income thresholds and tax rates remain unchanged.the amounts and rates are as follows Annual taxable income A ($) Rate V Constant K ($) 0 31, ,000 67, ,000 and over ,720 New Brunswick The New Brunswick Basic Personal amount is increased by the index factor; it is usually revised to $9,758 (formerly $9,633). The New Brunswick Spouse Common Law Partner amount is increased by the index factor; it is usually revised to $8,286 (formerly $8,180). The following table shows tax rates and income thresholds for Annual taxable income A ($) Rate V Constant K ($) 0 40,492 (formerly 39,305) ,492 80,985 (formerly 79,946) ,081 (formerly 2,055) 80, ,664 (formerly 129,975) ,458 (formerly 3,414) 131, , ,196 (formerly 5,129) 150, , , ,00 and over ,811 Newfoundland and Labrador The Newfoundland Basic Personal amount shall be increased by the index factor, so it is updated to $8,802 (formerly $8,767). The Newfoundland Spouse Common Law Partner amount shall be increased by the index factor, so it is updated to $7,192 (formerly $7,163). The following table shows tax rates and income thresholds for Annual taxable income A ($) Rate V Constant K ($) 0 35,148 (formerly 35,008) ,148 70,295 (formerly 70,015) ,687 (formerly 1,680) 70, , ,249 (formerly 2,241) YEAR-END UPDATE / 2015 TAX UPDATE

25 CHAPTER 4 TAX UPDATES Annual taxable income A ($) Rate V Constant K ($) 125, , , ,700 and over ,261 Northwest Territories The Northwest Territories basic personal amount shall be increased by the index factor; it is usually revised to $14,081 (formerly $13,900). The spouse or common-law partner amount shall be increased by the index factor; it is usually revised to $14,081 (formerly $13,900). The following table shows new income thresholds for the Northwest Territories. Tax rates are unchanged. Annual taxable income A ($) Rate V Constant K ($) 0 41,011 (formerly 40,484) ,011 82,024 (formerly 80,971) ,107 (formerly 1,075) 82, ,353 (formerly 131,641) ,060 (formerly 4,008) 133,353 and over ,527 (formerly 6,443) Nova Scotia There is no change to the personal or spouse/common-law partner amounts; both remain at $8,481. The index factor is The following table shows tax rates and income thresholds for Annual taxable income A ($) Rate V Constant K ($) 0 29, ,590 59, ,823 59,180 93, ,841 93, , , ,000 and over ,863 Nunavut The Nunavut basic personal amount shall be increased by the index factor; it is usually revised to $12,947 (formerly $12,781). The spouse or common-law partner amount shall be increased by the index factor; it is usually revised to $12,947 (formerly $12,781). The following table shows income thresholds and tax rates for Annual taxable income A ($) Rate V Constant K ($) 0 43,176 (formerly 42,622) ,176 86,351 (formerly 85,243) ,295 (formerly 1,279) 86, ,388 (formerly 138,586) ,022 (formerly 2,984) 140,388 and over ,532 (formerly 6,448) Ontario The Ontario Basic Personal amount shall be increased by the index factor; it is usually revised to $10,011 (formerly $9,863) YEAR-END UPDATE / 2015 TAX UPDATE 21

26 CHAPTER 4 TAX UPDATES The Ontario Spouse or Common-law Partner amount shall be increased by the index factor (1.015); it is usually revised to $8,500 (formerly $8,375). The following table shows income thresholds and tax rates for Annual taxable income A ($) Rate V Constant K ($) 0 41,536 (formerly 40,922) ,536 83,075 (formerly 81,847) ,703 (formerly 1,678) 83, ,000 (formerly 150,000) ,373 (formerly 3,323) 150, ,000 formerly 220, ,873 (formerly 4,823) 220,000 and over ,073 The Ontario provincial surtax thresholds for 2016 are as follows: Reduction type in $ Basic personal amount 231 (formerly 223) Each dependent under age (formerly 421) Each dependent with a disability claimed on Form TD1ON 427 (formerly 421) Ontario provincial surtax thresholds for 2016 have been revised as shown in the following table. Basic provincial tax payable - T4 ($) Surtax payable - V1 ($) 0 4,484 (formerly 4,418) 0 4,484 5,739 (formerly 5,654) 20% of tax in excess of 4,484 5,739 and over 20% of tax in excess of 4,484, plus 36% of tax in excess of 5,739 Prince Edward Island There are no changes to the basic personal amounts at $7,708. The index factor is The nonrefundable personal tax credit for Prince Edward Island remains $7,708. The following table tax rates and income thresholds for Annual taxable income A ($) Rate V Constant K ($) 0 31, ,984 63, ,279 63,969 and over ,134 Quebec The TP V Basic amount is increased by the index factor (1.0109); it is usually revised to 11,550 (formerly 11,425). When the system calculates this amount, it is rounded to the nearest $5.00. The following table shows rates and income thresholds for Annual taxable income A ($) Rate V Constant K ($) 0 42,390 (formerly 41,935) ,390 84,780 (formerly 83,865) ,695 (formerly 1,677) YEAR-END UPDATE / 2015 TAX UPDATE

27 CHAPTER 4 TAX UPDATES Annual taxable income A ($) Rate V Constant K ($) 84, ,150 (formerly 102,040) ,086 (formerly 5,032) 103,150 and over ,891 (formerly 6,817) Deduction for employment income The deduction for Employment income has been increased to $1,130 (formerly $1,120). Thus the deduction is now the lower of 6% of employment income or $1,130. Health contribution formulas As of 2015, employers must withhold the health contribution of an individual who, during the year, is 18 or over. The formulas for calculating the source deductions of Québec income tax have been amended to take into account the health contribution. For 2016, the rates and the amounts used to calculate the value of the health contribution remain unchanged. Heading More than Equal to or less than 0 $18,570 0 $18,570 $41,265 Whichever is less: $100 5% x(r-$18,570) $41,265 $134,095 Whichever is less: $200 $100 + [5% x(r-$41,265)] $134,095 Whichever is less: $1,000 $200 + [5% x(r-$134,095)] Saskatchewan The Saskatchewan Basic Personal amount is increased by the index factor (1.013); it is usually revised to $15,843 (formerly $15,639). The Spouse Common Law Partner amount is increased by the index factor; it is usually revised to $15,843 (formerly $15,639). The Child amount is increased by the index factor; it is usually revised to $6,010 (formerly $5,933). The Senior supplementary amount is unchanged. The following table shows tax rates and income thresholds for Annual taxable income A ($) Rate V Constant K ($) 0 44,601 (formerly 44,028) , ,430 (formerly 125,795) (formerly 881) 127,430 and over ,441 (formerly 3,396) Yukon The Yukon basic personal amount shall be increased by the index factor (1.013); it is usually revised to $11,474 (formerly $11,327) YEAR-END UPDATE / 2015 TAX UPDATE 23

28 CHAPTER 4 TAX UPDATES The spouse or common-law partner amount shall be increased by the index factor; it is usually revised to $11,747 (formerly $11,327). The following table shows new income thresholds and tax rates. Annual taxable income A ($) Rate V Constant K ($) 0 45,282 (formerly 44,701) $0 45,282 90,563 (formerly 89,401) $1,177 (formerly 1,180) 90, ,388 (formerly 138,586) $2,898 (formerly 2,754) 140, , $5,565 (formerly 4,583) 138,586 and over $16,565 Yukon s territorial Canada Employment Credit has been increased to $1,161 (formerly $1,146). Updating basic personal amounts To update the Basic Personal amounts: Tools>> Routines>> Payroll-Canada>> Year End File Reset This process will reset YTD totals in the Employee Master file. Do you want to continue?" Click "Yes" "Do you want to update Basic Personal Amounts in the Control Setup File?" Click "Yes" The personal tax credit amounts specified in the P_CPY_Control table will be updated to: Basic Personal amount = $11,474 Quebec TP V Base amount = $11,550 Alberta basic personal amount = $18,451 British Columbia basic personal amount = $10,027 Manitoba Basic Personal amount remains at $9,134 New Brunswick Basic Personal amount = $9,758 Newfoundland Basic Personal amount = $8,802 Northwest Territories basic personal amount = $14,081 Nova Scotia basic personal amount = $8,481 Nunavut basic personal amount = $12,947 Ontario Basic Personal amount = $10,011 Prince Edward Island basic personal amount remains at $7,708 Saskatchewan Basic Personal amount = $15,843 Yukon basic personal amount = $11,474 You can view these amounts in the Tax Credits window: Tools >> Setup >> Payroll- Canada >> Control >> Tax Credits. Index factors for 2016 The following table shows how Index Factors as specified in the Tax Credit Indexation Factors window (Payroll Reset Files window (Tools>>Routines>>Payroll-Canada>>Year End File Reset>>Tax Credit Indexation Factors) have been updated YEAR-END UPDATE / 2015 TAX UPDATE

29 CHAPTER 4 TAX UPDATES Note that an amount listed as means that the index factor is 6%. Taxing authority 2016 index factor 2015 index factor Federal Alberta British Columbia Manitoba (NA) New Brunswick Newfoundland/Labrador Northwest Territories Nova Scotia (NA) Nunavut Ontario Prince Edward Island (NA) Quebec Saskatchewan Yukon YEAR-END UPDATE / 2015 TAX UPDATE 25